Unum Group Hikes Dividends, Approves Buyback

As an income investor, you might not care much about insurance company Unum Group’s (NYSE:UNM) impressive climb in its stock price recently. But you should pay attention now, because the company just raised its dividend again.

“We are pleased to again increase our dividend payout, which is representative not only of our consistent performance and financial strength but also of our commitment to returning value to shareholders,” said Richard McKenney, president and chief executive officer of Unum. (Source: Ibid.)

With the increase, the company will be paying $0.80 per share on a yearly basis, translating to an annual dividend yield of 2.2%.

Note that this marks the eighth consecutive year in which Unum has raised its dividends. At the new rate, the company’s quarterly dividend is 166% higher than what it was back in 2007.

Unum has done a solid job in terms of returning value to shareholders. Other than dividends, it also spent billions of dollars on stock buybacks. Since the fourth quarter of 2007, the company has repurchased approximately $3.3 billion of its stock, reducing its outstanding share count by 36%.

Going forward, Unum Group could benefit from its expanding portfolio. Last year, the company acquired National Dental Plan in the U.K. This year, it announced plans to acquire dental and vision benefits provider Starmount Life Insurance.

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